Jeff Proponent-1.png Proponent

Fast 5: Kapco Global-Avio Diepen Merger Bears Fruit

Two and a half years after the merger of Kapco Global and Avio Diepen which resulted in the creation of component distribution specialist Proponent just over one year ago, the California-based company is now looking to its next phase as a single entity. Proponent’s chief operating officer Jeff Nixon spoke to James Pozzi at MRO Asia-Pacific about its global plans and the evolving demands of the parts distribution market.

The merger of Kapco Global and Avio Diepen in May 2016 created the world's largest independent aerospace distributors. In the preceding two and a half year period, give the scale of both operations, how has the integration played out?

We took a very methodical approach to how we integrate both companies, starting with our teams and processes over the course of two years. Now, at the end of November, our internal system will be in place and once this has been done, the Avio Diepen name will be retired and we will operate solely as Proponent. We recently celebrated our first anniversary with the Proponent name, where we took the Kapco Global side of the business and changed that to Proponent. 

What were the obvious synergies between Kapco Global and Avio Diepen joining forces?

There were two obvious ways. First, our customers complimented eachother so we found that we had common ones yet with still with very different portfolios. Our product breadth and depth became much greater through bringing two distinct companies together: Kapco had always been very Boeing-centric, while Avio Diepen focused more on Airbus components. Bringing those two together enables us to expand the platforms we offer across any part of the world. The merger will make Proponent truly global - we currently have 12 locations across the world.

Specifically looking at the Asia-Pacific region, which will see a lot of fleet and MRO growth over the next decade, where is Proponent seeing the real opportunities as a parts distributor?

There's no doubt that the region is growing and will continue to be an important part of the global aviation industry. There's growth in the OEM population, the MRO segment and the work being carried out in the area, while airline proliferation is also happening. Looking at where growth is, we believe that Asia-Pacific really is an epicenter for growth going beyond the considered industry standards. Like many others in this industry, we are planning to fine tune our investments in Asia-Pacific and there's a real opportunity to grow the business here over the next four to five years.

Now the merger process is finally reaching its conclusion, what's next for Proponent?

The journey strategically was about bringing the companies together not just with more product offerings but also ensuring it is a dynamic organization. There's been a real focus on reforming ourselves into something the market will appreciate. Over the next couple of years, we will be shifting our attention to improving service to customers and suppliers. The approach will much more outward focused and looking at services customers demand and anticipate what these may be in the future. Getting more analytical insights is going to be really important going forward. 

Are customer demand for parts distribution changing?

I don't think demand has changed as such - flying aircraft safety will always drive what customers do. However, how we deliver products and services to meet that end goal is really where the change lies. Having the right parts at the right place at the right time is the mantra we see customers talking about. They are more engaged in alternatives that allow them to focus on the delivery of their service to passengers. There are also demands on us to be more creative in terms of how we deliver this to them. On-time performance is key on an industry wide-level, so as distributors, we have to keep being creative to ensure products are dispatched around the world when they are needed. 

Analytics and data are omnipresent in the industry and will only continue to grow in size. How is Proponent investing in data-driven platforms?

Data in general is driving the world. Anyone who isn't paying attention to that part of their business or incorporating that as part of their decision making process or interaction with customers is at a distinct disadvantage. We aren't the first to realize the importance of data, but this is a great to invest. To be seen as somebody who understands the marketplace and being able to provide insights to help MROs and airlines make better choices to repair, maintain and operate their fleets, I think is not only exciting but sooner rather than later will be a necessity for any company. 

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